Sacramento Area Bogleheads Meeting Summary (August 11, 2016)

This article is composed by Bogleheads® forum member digarei

SEVEN (07) members gathered in mid-town Sacramento on the Second Saturday of August 2016 at 10:30 AM to explore the first steps that should be undertaken to protect one’s assets after death: identify and enumerate titled property, liquid assets, accounts and beneficiary designations; and weigh the available legal remedies intended to avoid probate: Wills, Trusts and POD/TODs. Also discussed were advance health directives, powers of attorney, several common types of trusts and a number of cautionary stories.

estate-planning-imageEstate attorneys will assert that two-thirds of all adults who die in the United States are intestate—a super majority die without having prepared a will or made provision for a successor trustee to direct the orderly transfer of their assets. For those with real property valued over 50K or an estate valued at 150K, the state will move to dispose of the assets through a legal process known as probate. There may be multiple competing claims on the funds generated by the estate in such a process and heirs can find themselves lost in a sea of bureaucracy and confusion for many months or several years awaiting completion of title searches, disposition of claims and counterclaims, distribution of money to creditors, attorneys appointed by the court and so forth. It is also a very costly endeavor for beneficiaries, who will lose entitlement to any monies deemed by law and by the court as payment for attorneys fees and court costs in conjunction with probate. Without probate, it’s probable that these fees and costs would have remained with the estate as unspent dollars resulting in a higher distribution to beneficiaries. Common probate costs range from 3-10% or more of the estate’s total valuation.

It seems almost everyone has either experienced first-hand or knows someone who has been caught up in the interpersonal drama and stress caused by hurt feelings, anger and enmity that develops between family members when there is an expectation or feeling of entitlement to property and money left by the deceased. Sometimes estate documents are excluded from consideration due to unfortunate phrasing, effectively causing property or funds to be redirected from the intended recipient to, for example, an estranged relative.

The issues are complex, therefore potential for errors is high. And there appears to be disagreement even among attorneys in their general advice. Estate planning attorneys often disparage the skills and abilities of general practice attorneys, some of whom in turn warn prospective clients away from the estate specialists. A number of self-help books suggest that a lawyer isn’t needed at all except for those with very large estates or a complicated trust.

Attempting to negotiate this mine-field is chapter co-coordinator Christy (“carruthers209”), who prepared a number of helpful documents for the August meeting, and guided members in the discussion.

Christy will be continuing this topic as a series beginning in February (2017), each month focusing on a different aspect of the estate planning process.

The following documents were made available to meeting participants:

  • Estate Planning 101 – presentation (Pages format)
    Aug2016Mtg_Bogleheads.EstatePlanning.101.pages
  • Estate Planning 101 – supplements (Numbers format)
  • Aug2016Mtg_OnePageAssetSummmary.numbers
  • Aug2016Mtg_Bogleheads.BeneficiaryChecklist.1.numbers
  • California state forms (PDF format)
  • Aug2016Mtg_PowerofAttorney.pdf
  • Aug2016Mtg_CACourts.Affidavit for Transfer of Personal Prop…th $150,000 or Less – probate_selfhelp.pdf

The meeting transcript contains a list of links (see page 10, “MtgNotes_20160813_Aug.pdf”) to some very useful information authored by estate planning specialists at Vanguard. Recommended reading:

  • Estate Planning 101 – meeting notes / transcript (PDF format)
    MtgNotes_20160813_Aug.pdf

An e-mail, containing an edited transcript (13 pages) elaborating
the discussion items conveyed in this post and the estate planning
aids listed above, was sent to attending members on 10-27-2016.

About

Barry Barnitz, administrator of both the Bogleheads® wiki and of Financial Page, a Bogleheads® blog

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